Zarara firm to splash Sh1.59b on Lamu gas venture

The firm says in an Environmental Impact Assessment (EIA) report filed with the National Environment Management Authority (Nema) it had long-term plans of using the gas recovered to generate electricity that will be fed to the national electricity grid.PHOTO:COURTESY

Oil and gas exploration and production firm Zarara plans to spend Sh1.59 billion to prospect for natural gas in Lamu.

The firm says in an Environmental Impact Assessment (EIA) report filed with the National Environment Management Authority (Nema) it had long-term plans of using the gas recovered to generate electricity that will be fed to the national electricity grid.

Zarara is at the moment seeking regulatory approval to start drilling blocks L4 and L13 in Lamu County.

The two blocks have previously encountered high-pressure gas, but previous operators did not determine the quantity and quality due to technical problems while drilling.

Exploratory drilling

Zarara, a subsidiary of the Cayman Islands-registered Midway Resource International, is the operator of blocks L4 and L13 where it also has a 75 per cent working interest.

The other shareholders are Sohi Gas (15 per cent) and the Government, which has a 10 per cent carried interest. The firm said it plans to use the natural gas from the area to put up an electricity generating plant.

It expects to undertake the development in three phases, with the exploratory drilling that it is about to embark on being the first phase of the project.

It will then build the natural gas-powered plant of up to 100 megawatts (MW) in the second phase before scaling this up to 900MW.

The firm said the second phase will entail the construction of a gas processing plant and installation and commissioning of a temporary electricity generating facility of 20-100MW of gas-powered single cycle reciprocal engine generators on Pate Island.

The electricity will be transported by cable across the island and along the seabed to the Lamu Port area.